WASHINGTON (AP) _ President Clinton began lifting trade and economic sanctions against Yugoslavia on Thursday in a gesture of support for the newly elected regime in Belgrade.

``The victory of freedom in Serbia is one of the most hopeful developments in Europe since the fall of the Berlin Wall,'' the president said. ``It ended a dictatorship and it can liberate an entire region from the nagging fear that ethnic differences can again be exploited to start wars and shift borders.''

Clinton said he had directed the immediate lifting of an oil embargo and a flight ban to Yugoslavia, part of a package of sanctions imposed in 1998.

``The removal of these sanctions is a first step to ending Sebia's isolation,'' Clinton said in a written statement.

Clinton acted just days after the European Union lifted an oil embargo and a ban, which had already been suspended, on commercial flights to and from Serbia, the main Yugoslav republic. The EU did not remove sanctions that froze overseas assets of former President Slobodan Milosevic and his allies and prohibited them from traveling to 15 EU nations.

Clinton said his actions would not affect U.S. sanctions targeted against members of the former regime.

Announcing the easing of penalties, Clinton said the United States has ``a strong interest in supporting Yugoslavia's newly-elected leaders as they work to build a truly democratic society.''

Clinton's adviser on the Balkans, James O'Brien, was meeting Thursday in Belgrade with new Yugoslav President Vojislav Kostunica to congratulate his country for its steps toward democratic rule and reinforce the message that the country must make more progress in order to be completely free of sanctions.